UPDATE 3-Argentina defies U.S. court order by depositing debt payment

BUENOS AIRES, Sept 30 (Reuters) - Argentina deposited a $161
million bond interest payment with a newly appointed local
trustee on Tuesday, the Economy Ministry said, defying a U.S.
judge who held it in contempt a day earlier for taking illegal
steps to meet its debt obligations.

The country wants to show it can service its debt and that
its failure in July to complete a payment to holders of bonds
that were restructured after its 2002 default was the result of
adverse U.S. judicial rulings.

"By making this deposit, Argentina confirms once again its
unshakeable commitment to meet its obligations to bondholders,"
the ministry said in a statement.

It was not clear how many bondholders would receive their
coupon payments before the end of the Sept 30 deadline without
the assistance of foreign financial intermediaries, which could
violate the U.S. court orders if they aid Argentina.

Luxembourg-based clearing house Clearstream said it always
abided by court rulings and a source at the trustee bank,
state-controlled Nacion Fideicomisos, acknowledged little of the
deposit had been transferred to creditors.

If the funds fail to reach bondholders, a 30-day grace
period would be triggered, after which the default, which has so
far confined to Discount bonds, would spread to the Par series.

The central bank deposited the coupon payment on its foreign
law Par bonds with Nacion Fideicomisos after
the government removed the former trustee, Bank of New York
Mellon Corp, to skirt the U.S. court rulings.
Continuación...